Buy a house in New Zealand with a UK mortgage

[UK2NZed]

G'day Possums.

We're moving to Auckland next year. we visited in January and liked what we saw. We're planning to live in the North Shore, one of the bays preferably.

The house prices look a bit eye watering. Since mortgage rates in the UK are lower than in NZ, we've started wondering if we can use this to our advantage. Has anyone any experience of using a UK mortgage to by a house in New Zealand? Is it possible? Is it advisable?

[Bozeman]

Just imagine what an unfavourable exchange rate swing would do to you under these circumstances.

[JandM]

Hello and welcome.

[Manks]

I doubt this is possible. When I was talking to a bank here about the possibilities of securing a loan against our UK house (before we sold it) they told us there was no way they could do that because they had no knowledge or experience of the local housing market, therefore they could not secure a loan against a property outside of their investment expertise. I imagine the same would be said in return.

[girlwithanewf]

This just isn't a good idea, and as said above probably not possible. As also said above, you would have the stress of worrying about exchange rate fluctuations. Besides, if you defaulted on your mortgage, how would the bank be able to repossess the house? Even if such a product was available, it would be prohibitively expensive.

You could of course secure a mortgage on a UK property and buy a house here for cash, but again your debt would be in Sterling and your assets and income in NZD.

Good luck with your house plans, though.